CMS Duplicating Efforts to Test New Programs, GAO Study Says

Mark Crane

December 20, 2012

The US Centers for Medicare & Medicaid Services (CMS) may be duplicating efforts and paying for the same services under multiple programs to test new payment and treatment delivery models, the US Government Accountability Office (GAO) said in a recent report.

Better coordination among the programs is needed to prevent the inefficient use of federal resources, GAO said.

The CMS Innovation Center became operational in November 2010, 8 months after the Patient Protection and Affordable Care Act was signed into law. The agency received 10 times the federal funding ($10 billion through 2019) for research, demonstrations, and evaluations than had been appropriated in the previous decade. It also hired 184 new employees.

The Innovation Center has focused on implementing 17 new models to test different approaches for delivering or paying for healthcare (such as accountable care organizations and shared savings), as well as quality programs intended to reduce hospital readmission rates and hospital-acquired conditions. It is still relatively early in the process of implementing these models, GAO said.

The Innovation Center projects that a total of $3.7 billion will be required to fund testing and evaluation of the 17 models, with the expected funding for individual models ranging from $30 million to $931 million.

GAO identified 3 key examples of overlap between the 17 models and the efforts of other CMS offices, meaning that the efforts share similar goals, engage in similar activities or strategies to achieve these goals, or target similar populations. However, these overlapping efforts also have differences, and CMS officials said the efforts are intended to be complementary to each other.

"Largely because of questions raised during GAO's review, the Innovation Center initiated a process to ensure that CMS does not pay for the same service under the contracts in one of its models and those in another CMS office. However, officials told GAO that the center is still working on implementing this process and may need to take additional steps to eliminate any unnecessary duplication," GAO said.

For example, 2 accountable care organization models — Pioneer and Advance Payment — have similar goals with the shared savings program that CMS is operating. The 2 centers have different approaches to sharing any realized savings, GAO noted. Although the Innovation Center is testing Medicaid payment models, so is the Center for Medicaid and CHIP Services. There also are similarities in quality programs operated by the Innovation Center and the Center for Clinical Standards and Quality, GAO said.

"GAO is recommending that the Administrator of CMS direct the Innovation Center to expeditiously complete its process to review and eliminate any areas of unnecessary duplication in contracts that have been awarded in 1 of its models. HHS agreed with this recommendation and described steps it is taking to address unnecessary duplication."

The GAO study began after some members of Congress raised questions about whether the Innovation Center's models will actually lead to reduced costs and improved quality. They also voiced concerns about the potential for overlap in these efforts at CMS.

The GAO report, "CMS Innovation Center: Early Implementation Efforts Suggest Need for Additional Actions to Help Ensure Coordination with Other CMS Offices," is available on the GAO Web site.